one powerful team
Product manager, project manager—although two letters make a big difference, everyone works for a common goal.
By Steven Haines
Two
of the most important business functions are project management and product
management.
In most organizations, these functions work in a symbiotic manner, yet
their purpose is distinctly different. Moreover, the definitions of these
two terms are often confused. Some people even use the terms interchangeably.
How do project and product management work within an organization? We'll
compare and contrast the two roles so that you'll get a clear idea
of what the jobs involve, where they fit within an organization, who does
the jobs, how they're interrelated, and why they're both
important to the success of a firm.
First, we need to get a few definitions out of the way.
A product includes any tangible or intangible item, service, or bundle
of goods and services offered for sale. Products have a lifecycle in which
they're conceived, developed, introduced, and managed.
A project, on the other hand, includes a series of activities and tasks.
Those who carry out the tasks use resources to create or support a product
or service. Projects are organized within a systematic framework. They
depend on employees and managers who perform those tasks and manage the
associated project risks. When the task is finished, that's the
end of that project's activities. Like products, projects have
a lifecycle. They have a start point and an end point.
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| Take a cash machine, for instance: one product, but many projects. |
The products represent the essence of the business. They are the goods
and services by which a business thrives and grows and brings in revenue.
Projects are activities that derive, deliver, and support products and
other business elements.
Product managers are individuals appointed as the executives who oversee
products or product lines. They lead cross-functional product teams that
include people representing various departments of a company, including
engineering, manufacturing, and marketing. It is the job of the teams
to optimize the product's market position and financial return
across its lifecycle. They ensure that the product's position is
consistent with the corporation's and division's business
strategies.
Project managers plan, monitor, and control all aspects of a project.
They synchronize resources and motivate employees to carry out the project
against the constraints of time, cost, and quality, and seek to mitigate
risks that may emerge. Project managers oversee projects from start to
finish. Many project managers may work for a product manager as a product
is developed, introduced into manufacturing, and sold on the open market.
Product managers and project managers do share some common characteristics.
They both need excellent organizational and interpersonal skills. They
need to be relentless and persistent in the drive to achieve their team's
goals. Teams don't just rally around the cause; they rally around
the spirited inspiration of the person who represents the cause.
Both project and product managers need to have leadership qualities. They
both need access to technologies and tools that help them synchronize
business data, to get a bird's-eye view of how the project is progressing
against the established plans.
Product managers and project managers also share common challenges. In
most organizations, they'll need to secure resources from different
aspects of the business. Organizations that aren't aligned with
specific corporate or division strategies may not commit those important
resources and may jeopardize product or project goals. Imagine uncovering
a quality problem with a product and asking your manager who you should
talk to, and your manager refers you to a project manager of a development
project when, in fact, it would be the product manager who would be more
concerned with the cross-functional issue of a product quality problem.
Not knowing the distinction between the roles could be a problem.
Let's look at an example to distinguish a product from the projects
that support it. A company plans to create a new automated teller machine
for its banking clients to use in supermarkets. The ATM is the product.
But before the product can be developed and launched on time, the company
might have to undertake three separate projects: a market research project,
a development project, and a product launch project.
The marketing project team would conduct research to assess the size of
the market for this product. The development team might have two separate
projects, one focusing on design of the cabinet and one for developing
a new security system. The product launch team might create and manage
an event to announce the product at a major trade show. Certainly, more
projects would be undertaken, but the point is that each of these separate
projects must come together in order to launch the product on time.
A Standard Way to Work
All projects use a standard methodology, which includes initiating the
project, planning the project, executing work, monitoring performance
against the plan, and completing the project.
Likewise, products are also developed and managed using a systematic method.
First, the product is conceived from a series of ideas that originate
by observing the market, tracking the competitor's activities,
speaking with customers, or looking at new technology. A business doesn't
just accept any product idea. Many firms screen product ideas and select
the ones that fulfill their business goals.
The business develops the selected products and introduces them to the
market. After the products are introduced, a team manages them within
the market to make sure the products are profitable. The team may make
adjustments to pricing, advertising and promotion, distribution, and product
attributes to optimize market position and profitability.
As products move through their lifecycles, team members, customers, and
others come up with new product ideas and uncover new market opportunities.
Thus, the cycle starts again.
Certifying the Manager
Because universities teach very little in the way of product management
and because corporations don't often offer product management training,
each organization interprets product management differently. The people
in charge of the firm's products, brands, and categories define
the role of product management within their organization.
Product managers are usually homegrown and come from departments like
marketing, product development, or finance. Though few certification programs
exist for product managers, the Association of International Product Management
and Marketing offers a certification program, as does the Product Development
and Management Association.
Project managers, on the other hand, can learn from the Project Management
Body of Knowledge from the Project Management Institute. It describes
the sum of knowledge within the profession of project management. A unified
body of knowledge means that an organization can be assured that project
managers have completed specific training, and that those project managers
have the skills to manage according to a standard methodology.
Products represent the lifeblood of the firm. Projects represent the skeletal
structure. Both work in harmony. Neither stands alone. Product management
is re-emerging as one of the most important functions within a business,
and project management remains a solid way for the product team to deliver
products and services.
Everyone employed by an organization must understand these roles and how
vital they are to the survival of the firm in fiercely competitive and
ever-changing markets.
Steven Haines is the chief executive officer of
Sequent Learning Networks, a New York City-based training company for
those who manage products and services.